Equity Bancshares, Inc. (NASDAQ:EQBK) (“Equity” or the “Company”), parent company of Equity Bank, announced it has entered into a definitive merger agreement to acquire City Bank and Trust, (“CBT”) of Guymon, Oklahoma, from parent company Docking Bancshares, Inc. (“Docking”) of Arkansas City, Kansas. Equity anticipates closing the merger in the fourth quarter of 2018.

The merger announcement occurs after Equity’s May 4, 2018 entry into Southwest Kansas with the closing of its merger with Kansas Bank Corporation (“KBC”), which had bank locations in Liberal and Hugoton, Kansas. Equity previously expanded into Oklahoma through mergers with Cache Holdings, Inc. and Eastman National Bancshares, Inc. in November 2017, adding Oklahoma as a fourth state to its Midwestern footprint. Equity has completed 17 successful business combinations since 2003, and eight since the Company’s initial public offering in November 2015.

“Adding diverse community bank markets, like Guymon, with strong local ties remains a core component of our strategy. CBT fits our footprint nicely, as an additional location for our Southwest Kansas market, and this transaction will provide additional resources for our Oklahoma customers,” said Brad Elliott, Chairman and CEO of Equity. “Our mission to grow Equity’s franchise includes the continued addition of stable, core deposit markets committed to local customers, while ensuring our culture, leadership, and service is a fit.”

The CBT merger adds another strong deposit market to Equity’s Southwest footprint. CBT ranks first in reported deposit market share in Texas County, Oklahoma, according to June 2017 data from the FDIC. Equity’s Southwest Kansas locations rank first in reported deposit market share in Seward County, Kansas, and upon closing with CBT, Equity’s pro forma Southwest market will include approximately $428 million in deposits.

Equity reported $3.6 billion in consolidated total assets, loans of $2.4 billion, and deposits of $2.8 billion following completion of its mergers with KBC and Adams Dairy Bancshares, Inc. on May 4, 2018. Equity currently has 48 full-service bank locations in Arkansas, Kansas, Missouri and Oklahoma. After completion of the merger, Equity expects to have approximately $3.9 billion in consolidated total assets, and the combined institution is expected to have approximately $2.5 billion in loans and $3.0 billion in deposits.

City Bank and Trust, Guymon, Oklahoma

City Bank and Trust principally conducts banking business through its full-service branch location in Guymon, Oklahoma. Guymon is the largest community in Oklahoma’s panhandle region. CBT was founded in 1901 as Beaver County Bank. Parent company Docking acquired CBT in 2002.

As of March 31, 2018, CBT had $172.5 million in total assets, $76.7 million in loans and $139.4 million in deposits. CBT ranks No. 1 in FDIC deposit market share in Texas County, Oklahoma, with 27.4%, as of June 30, 2017, according to FDIC data published by SNL Financial. CBT local leadership will continue to serve as part of Equity, and will work with Equity’s Southwest Kansas market.

“We’re proud to find a partner that will continue providing sophisticated and vital solutions to our community in Guymon, Oklahoma. For more than 100 years, CBT has been committed to the banking and wealth management needs specific to our Guymon and Oklahoma customers, and we’re eager for Equity Bank to continue delivering financial solutions and local decision-making that our customers trust,” said William Docking, Chairman, President and CEO of Docking.

“Equity Bank shares a commitment to our customer base, prioritizing community banking and with a track record that includes markets focused on agricultural, manufacturing, and a sizable, loyal consumer base,” said Jim Webster, President of CBT. “We’re pleased to align with a community bank prioritizing local service, local decision making, and the unique needs of our business, farm, and community customers.”

At closing of the transaction, which is expected to occur in the fourth quarter of 2018, Equity will acquire all of CBT from Docking, subject to receipt of customary regulatory approvals and closing conditions. Under the terms of the definitive agreement, at the effective time of the merger, Docking will receive consideration of approximately $18,900,000 in cash, subject to adjustments based on the equity capital of CBT at closing, as further set forth in the definitive merger agreement.

Equity expects the merger to be approximately $0.14 accretive to diluted earnings per share in 2019, and $0.17 accretive to earnings per share in 2020, with transaction-related and one-time costs of approximately $2.2 million. Equity expects the merger to be approximately 2.8% dilutive to tangible book value per share at closing, inclusive of the estimated purchase accounting adjustments, and expects the tangible book value earn back to be 2.75 years using the cross-over method. Finally, Equity expects to remain above all “Well Capitalized” capital ratios as defined by regulatory guidelines, inclusive of the impact of all estimated purchase accounting adjustments.

Equity was advised by Sandler O’Neill + Partners, L.P., and was represented by Norton Rose Fulbright US LLP as legal counsel.

Docking was advised by The Capital Corporation and was represented by Stinson Leonard Street LLP as legal counsel.